Obama: Industry ignoring lessons

NEW YORK — President Barack Obama traveled to Wall Street on the first anniversary of the collapse of Lehman Brothers and warned that early signs of the nation's economic turnaround should not lead to a return to the old ways in the financial industry.

"What I want to emphasize is this: normalcy cannot lead to complacency," the president in a speech at Federal Hall.

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"Unfortunately, there are some in the financial industry who are misreading this moment. Instead of learning the lessons of Lehman and the crisis from which we are still recovering, they are choosing to ignore them."

Obama delivered his remarks in a small but ornate central foyer that was packed with financial and business luminaries, as well as representatives of consumer groups.

But his speech, in which he said the Wall Street crisis was a "failure of responsibility" by those in finance and in government, was cooly received by the executives in the room, many of whom are prominent Obama supporters.

Only one line received even a smattering applause - and that was when the president discussed his proposed consumer financial protection agency, which drew praise from the consumer advocates in the audience.

Afterward, those who would talk on the record gave uniformly positive reviews.

"What he said makes sense," said former Securities and Exchange Commission chairman Bill Donaldson. "I don't think it will be easy to do, but he's determined to do so."

In his remarks, Obama traced the history of the financial crisis and walked a careful line between taking credit for the national economic recovery and assuring Americans that much more work remains to be done.

"Eight months later, the work of recovery continues," Obama said. "And although I will never be satisfied while people are out of work and our financial system is weakened, we can be confident that the storms of the past two years are beginning to break."

The president said that the taxpayers have begun to see some results from their investment of hundreds of billions of dollars in Wall Street bailouts - as much as 17 percent in the case of some investments that have already been repaid. And, he said, the need for government cash to backstop the private sector is coming to an end.